BY NKECHI NAECHE–ESEZOBOR–Ahead of the ongoing insurance industry recapitalization, the National Insurance Commission (NAICOM ) on Wednesday said that the commission do not want any insurance firm to be liquidated after the recapitalisation.
The Acting Commissioner for Insurance, Sunday Thomas, disclosed this at the Chartered Insurance Institute of Nigeria (CIIN) 2020 Business Outlook in Lagos, that the commission would offer regulatory forbearance which would provide an opportunity for un-recapitalised firms to team up together to enable them remain afloat.
The NAICOM boss explained further that commission would provide an orderly exit for un-recapitalised companies.
Speaking on ‘Recapitalisation & Stability in the Insurance Industry – Role of the Regulator’, Thomas noted that liquidation of firms often turns out to be difficult to handle due to issues around it and that it never favours both the regulator and operators.
He also disclosed that the commission will issue guidance note on recapitalisation by the end of first quarter 2020.
He maintained that recapitalisation is really necessary because when the industry is stabilised, it would help stabilised other sectors.
On roles of the commission in the ongoing recapitalisation, he said NAICOM as a regulator would ensure transparency and certainty of the process; orderliness of the recapitalisation process; ensure an enabling environment – palliative and level playing field – fair to all.
Other roles according to him include;ensuring that recapitased companies are liquid; safety of funds raised – Payment into Escrow Account; orderly exit of un-recapitalised companies and efficient resolution of pre and post-recapitalization governance/conflicts.
Thomas maintained that the the commission is committed to sustainable growth in order to enhance the stability of the Insurance Industry in Nigeria.
“We therefore invite the insurance sector to maximize the opportunities inherent in the 2020 Federal Government budget of sustainable growth and job creation whilst also ensuring seamless transition to the new capital regime of the Industry,” he said.
On financial inclusion, the NAICOM boss said that micro insurance and Takaful insurance policies can help to drive insurance penetration higher.
Managing Director/Chief Executive Officer, Dr. Oladimeji Alo, speaking on ‘The Nigerian Economy 2020 Issues, Challenges and Prospects for the Insurance Industry’ said many of the economics policies and plans for 2020 hold great prospect for growing the economy, promoting job creation and reducing poverty.
He said insurance firms that would do well in 2020 are those who had invested in their brand equity; innovation capabilities; talent management capabilities and information technology resources and capabilities.
Head, Financial Institutions Ratings, Agusto&Co Nigeria, Ayokunle Olubunmi, speaking on ‘Microinsurance; Driving the Nigerian Insurance Industry into the Future and Beyond’ urged insurers to harness the enormous untapped opportunities in the microinsurance sector.
